A new bid for a slice of Canberra's real estate advertising spend has started with a bang.
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The marketing blitz announcing the launch of property listing website Zango signals not only a shake-up coming to the ACT real estate scene.
It's a sign of a brewing struggle over advertising dollars that has already brought on a legal fight and an attempt to involve the competition regulator.
Zango has launched a salvo with a complaint to the Australian Competition and Consumer Commission against Canberra's dominant property website, Allhomes.
A skirmish is also unfolding in the Federal Court, where Allhomes has accused its challenger of false advertising.
It's been hard to miss Zango's flamboyant marketing campaign, splashing the company's signature colours of bright yellow, purple and black across buses, websites and social media.
Flight passengers collecting luggage at Canberra Airport see the company logo illuminated in large, back-lit advertising behind a baggage carousel. Free ice cream and a purple Zango truck photographed in front of Parliament House are part of the multi-pronged, colourful marketing offensive.
Neither Zango nor Coordinate, the company behind the ads, will disclose the sum spent on the campaign. Zango co-director and shareholder Peter Blackshaw says only that the budget is "substantial".
Coordinate's founder-director Jamie Wilson says while there may have been larger campaigns, Zango's was the most visible his company had been involved with in Canberra.
The prize is a foothold in classifieds for one of Australia's most expensive residential property markets, where one agency estimates its yearly spend on advertising with Allhomes at more than $1 million.
Zango went live on February 3, about 18 months after work began to create a locally-owned competitor to Allhomes.
Coming far ahead of the busy spring real estate season, the website's launch coincides with a price increase for property listings at its larger rival.
Zango is positioning itself as the cheaper alternative, channelling listings to its website by making them free until May. From then, it is planning to charge less than $300 to list a property for sale. It'll be cheaper again to advertise properties for rent.
Canberra real estate agencies say Allhomes prices, depending on the agent's zone, have increased to about $1500 per listing. Allhomes would not say how much it charges, but says prices increased 7 per cent in February after staying unchanged for about two years.
Creator turned challenger
Among its directors and shareholders, Blackshaw has been a leader of the project to challenge Allhomes, a business he started in 2000 and sold to real estate listings giant Domain 14 years later for $50 million.
Twenty years after creating Canberra's most successful online property listings company, Blackshaw is challenging its dominance with a new venture.
He says Zango started in response to the rising cost of listing properties with Allhomes.
"There is now a lot of pushback from people who are selling houses, particularly the houses and apartments that are lower value," Blackshaw says.
"People are price sensitive, and they are now offered an alternative."
Real estate agents have been attracted to Zango's offer of cheaper listings and local ownership as Allhomes lifts prices.
One Agency's Sandy Morris says the website is a "fresh face" on the Canberra market. She believes Allhomes has become "out of touch" since Domain bought it.
"Obviously when it moved from Canberra we felt like we lost touch with them. It didn't feel like a Canberra business any more. In our opinion it was money driven," she says.
But observers believe Zango will find it hard to carve out a slice of the Canberra market, where even the nationally-dominant REA doesn't top Allhomes.
Allhomes says it has grown to average 2.5 million website visits a month, and its monthly audience averages 900,000.
Blackshaw says he is a minor shareholder in Zango and the bulk of shares belongs to the 30 Canberra real estate agents investing in the website.
Directors include some of Canberra's largest real estate players: Luton chief executive Tim Xirakis, McGrath principal Craig Chapman, LJ Hooker Gungahlin owner Matthew Herbert, Ray White Canberra chief Ben Faulks and McIntyre Property's Col McIntyre.
Former Allhomes chief Tim White is a shareholder, as is his Region Media co-CEO Michael McGoogan.
A brewing conflict
The highly visible entrance of Zango to Canberra's property listings market is more than a talking point among real estate agents and a marketing curiosity.
In the background, the signs of conflict with Allhomes have already flared.
Zango's lawyers wrote to the Australian Competition and Consumer Commission in February accusing Allhomes of trying to block its entry into the ACT market.
Bradley Allen Love Lawyers says after October 2018 Allhomes tried to "buy the loyalty" of real estate agencies to discourage them from joining the group trying to establish Zango.
The letter to the ACCC, seen by The Canberra Times, says Allhomes approached agencies soon after "promoters" of Zango began speaking to real estate agents about the new website.
"Those approaches were made with a view, as the agencies understood matters, to offering cash incentives to remain 'loyal' to Allhomes," the letter says.
"This was substantially about not allowing the emerging competitor that became Zango to get a foothold in the ACT region market."
Zango's lawyers accused Allhomes of charging agents $750 more for a listing if they didn't list all their advertised properties with the website.
The ACCC has not formed a view on the matter and will leave it between the parties at this stage, according to an Allhomes spokesperson.
There's another front in the conflict between Zango and Allhomes.
The companies are tangled in a Federal Court case over the new challenger's advertising campaign.
Legal action started before the new website went live. Allhomes brought a case against Zango to the court on January 30, accusing it of misleading through ads that suggested it would be the website that "first" listed properties in the ACT.
Allhomes' spokesperson said the lawsuit sought orders blocking Zango from making the "first-to-list" claims on the basis that they were false and misleading.
"When the first statements were made, Zango did not have a live property listing portal," Allhomes says.
"Additionally, Allhomes understands that its agreements with real estate agents do not require them to list with Zango first."
The case could drag on until September, when the next court hearing is scheduled. In the interim, Justice Alan Robertson on February 4 ordered Zango to stop advertising that suggested new property listings in the ACT region were published on its website first.
Blackshaw dismisses the case as a "storm in a teacup".
"It's the sort of thing that big companies do," he says.
"It's more tactical than it is substantial."
Allhomes general manager Danielle Harmer says the company's aim in lodging the case was to make sure its customers were not being misled by false advertising, and were able to make informed decisions based on reliable facts.
Location, location
Some homeowners selling their property first learnt of Zango's push into the Canberra market when they received letters from Blackshaw encouraging them to list their home on the website.
The letters were addressed to clients of Peter Blackshaw Real Estate, a company no longer owned by Blackshaw.
The letters told sellers their properties were not getting full exposure, and encouraged them to call Peter Blackshaw Real Estate's managing director, Andrew Chamberlain, about listing on Zango.
"Canberra is a highly competitive real estate market. In my 30 years' industry experience, I have learnt that to sell a property quickly and at the highest possible price, it is essential that it is seen by the maximum number of interested buyers," Blackshaw wrote.
"This may not be happening with your property because it is not advertised on zango.com.au."
Zango's bid for real estate advertising dollars may be only part of the shake-up to come in the Canberra market.
Former Domain chief Antony Catalano and business partner Alex Waislitz have taken the largest stake in property portal Real Estate View after buying Australian Community Media, publisher of The Canberra Times.
Catalano has been reported to be pressing on with a push into real estate classifieds.
The ACM co-owner could not be reached for comment.
ANU marketing researcher Andrew Hughes says Zango's main initial target market is real estate agents, who are the most critical to its success.
Outside the group of Canberra real estate agents backing Zango, others have decided against investing.
Some in the industry are sceptical Zango will push down the ACT's listing costs as the size of Allhomes' audience entrenches it as the essential marketing platform.
Peter Blackshaw Real Estate has not invested in the website, but will list properties on Zango if homeowners request.
Independent Property Group managing director John Minns says his company is staying neutral as Zango challenges Allhomes, but will also list properties on the new website if clients request.
"There's very few people who are going to choose voluntarily not to be marketed on the Allhomes website," Minns says.
He says in his experience, having more property listings players on the market increases costs to consumers.
Blackshaw disagrees, saying competition will lower the cost of listings for real estate agents and homeowners.
"People who are really serious about buying a property will go to both sites because they don't want to risk missing out on buying their new home," he says.
"There's a lot of support for this and a lot of people who wish to see it succeed."
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Allhomes general manager Danielle Harmer says it is a local Canberra business and places its customers' interests first. The company is based in the south Canberra suburb Kingston despite being owned by Domain.
"While Allhomes provides a quality service to help agents and vendors reach the largest audience in the ACT, there are many choices available when it comes to vendors' decisions on how to sell their home, and we encourage that."
Dr Hughes says Zango's marketing campaign is creating two precious assets for a new brand: awareness and recall.
"Here in Canberra, the fact we're already talking about Zango shows the advertising campaign is working."
Trailing only Sydney and Melbourne in house prices and avoiding the larger price falls in Australia's two largest cities, Canberra has one of the more alluring digital property classifieds markets.
With those stakes, the early skirmishes over the city's real estate advertising market could foreshadow a longer, more bitter rivalry.